"Position yourself in the market, choose a target that must be united by a very specific identifying element. From the combination of these two elements, the specialized store takes shape."

In front of a crowded audience, mostly composed of women, Roberto Chiera explained which elements retailers should leverage to build customer loyalty. The theme of the meeting was "Discounts: the end of an era?", but the issue of price reduction was the starting point of the speech that Chiera – one of the promoters of Client School, the online school for independent retailers – delivered at Milano Home.

Discounts stimulate the occasional customer, pushing the product onto the person, trying to convince them to buy even if they are not really interested.

For over an hour, Chiera engaged in a conversation with the attendees, comparing ideas and evaluations that were sometimes convergent, other times discordant. However, there was almost unanimous agreement on one point: discounts are a dead-end road, a short-term strategy that stimulates the occasional customer and does not produce long-term effects.

So, why are store windows plastered with posters inviting people to enter the store during certain periods of the season?

For many, discounts are a bad thing, but there are also those who are not so severe in their judgment. Handing the microphone to the audience, Chiera gathered the moods and feelings of the retailers. It emerged that the practice of discounting can be useful for trying to sell products that have been in stock for a long time. Others stated that discounts are good because they fuel word-of-mouth and create positivity.

"Discounts indeed capture attention. But what kind of people do I attract and at what time of the year? Do I do it to get noticed? Because they didn't see me before?"

The questions raised by Chiera sparked a multi-voiced discussion that produced interesting and fruitful outcomes.

"When we offer discounts, we are pushing the product. In practice, we are telling the customer: buy it now because you will lose the opportunity."

Discounts are neither good nor bad in absolute terms. But one thing is certain: they are an option that lowers prices and margins and causes you to lose money. Independent retail is not structured to grow with discounts; it has a limited budget and economies of scale that have nothing to do with those of large chains and luxury brands.

Who do I attract by offering goods at reduced prices?

"Essentially two types of buyers. The 'discount hunters,' those who do not give much value to the product they are buying, and potential wasted customers, those who value the product and would be willing to pay full price but were enticed to come to the store because of the discounts. Two strategies that lower profits."

It is necessary to build the store's identity, intercept a specific target, and formulate solutions that can respond to the audience segment we want to address.

The real game is played on another field.

"How do I attract people's attention without the race to the bottom?" Chiera posed the question to the attendees and provided them with the keys to formulating effective plans through the "construction of the store's identity."

"The store must intercept a specific target; it is necessary to think and build around the customer. A specialized store increases conversions, and to create a certain type of business capable of satisfying and winning over the buyer, it is necessary to create a lovebrand.

The BRAND part refers to creating a well-defined identity, designed for a specific target. It is your Specialty Store. The LOVE part is linked to relationships with customers, which must be cultivated and strengthened, and which only independent retailers can weave with real effectiveness.

A store with its own specific identity is tailored to customers and increases conversions.

Doing marketing means creating a lovebrand, working well on your identity. This is the first step. If you do it – Chiera continued, addressing the retailers – then everything else (digital and print advertising, commercial initiatives, communications, etc.) will work better, cascading, because your identity attracts the right people."

A store with its own specific identity is tailored "to your customers, and this allows conversions to rise. This is the difference between buying for the price (generalist store) and buying for the value (specialized store)."

In conclusion, it is necessary to keep in mind two key concepts, two cornerstones that define the essential strategy for every store.

"People buy even without looking at the price, so you need to position yourself in the market to attract these people. How to achieve this goal? Choose a target and become the dream store for all the people who are part of it. The target, as mentioned before but it is worth repeating, must be united by an identifying element defined with extreme care."